The Wall Street Journal

  • AUGUST 17, 2011,

Howard Buffett, a Nebraska congressman and father of Warren Buffett, on how taxes curtail economic independence, December 1956.

  • From a speech by Howard Buffett, a congressman from Nebraska (and father of Warren Buffett), reprinted in the Freeman, December 1956:

The last 40 years have seen a gigantic expansion of political power over economic affairs by the federal government. This change is linked by many scholars to the passage of the income tax law in 1913. This law revolutionized the taxing system in two ways:

1. It gave the government new powers over the economic status of the individual. This change has curtailed the ability of the individual to achieve economic independence.

2. The part of his production taken from the producer cumulatively increases the power of the federal government proportionately with the increase in its income. This power is not created; it is simply taken away from the people. . . .

George Sokolsky, noted columnist, says it this way: “When human beings become dependent upon the political power of the state for their livelihood, the independence of person must disappear. It is the identification of economic power with police power that destroys the right of the individual to liberty.”

The transfer of economic power into political hands takes many forms. In 1932 about 2.5 million people received a check from the government every month. Today about 20 million receive a government check every month. What is the effect on the freedom of this great segment of our people being more or less dependent on the political authorities for their daily bread? . . .

Any discussion of the status of the economic foundation of freedom is incomplete without some attention to a historic human urge—the desire for security. This intense human desire is reflected in the so-called social legislation politicians have placed on our statute books.

Will this legislation fulfill its promises? If you think so, consider this rarely mentioned fine print clause. If the government is to guarantee you what the consequences of your actions will be in this case, security, then the government must take control of your activities. For with responsibility—even self-arrogated responsibility—must go authority.

This means that if politicians are to supply your security, they must control your work, your spending, and your saving. Witness crop controls. In that event you have traded the reality of liberty for the promise of security.


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